Double J Appraisals, LLC. has answers to "Frequently Asked Questions"
Describe an appraisal
Describe an appraisal(See list of FAQ's) The appraisal process is an evaluation that produces an opinion of value. There are three "common approaches to value" which helps the appraiser come to this opinion or valuation. One of the processes in use is the Cost Approach, which is what it would cost to replace the improvements to the home, minus depreciation and physical deterioration, plus the land value. Another of the processes is the Sales Comparison Approach - which concerns discovering a comparison to other similar properties within a close proximity which have recently sold. The Sales Comparison Approach is normally the most accurate and best indicator of value for a residential property. The third approach is the Income Approach, which is the most important method in appraising income producing properties - it involves estimating what an investor would pay based on the income generated by the property.
What does an appraiser do?(See list of FAQ's) An appraiser forumlates a fair and credible assessment of market value, often in the context of a real estate purchase. Appraisers summarize their investigation in appraisal reports.
What would cause me to request services from Double J Appraisals, LLC.?(See list of FAQ's) There are many reasons to order an appraisal from Double J Appraisals, LLC. with the most common reason being real estate and mortgage transactions. Some other reasons for ordering an appraisal report include:
How is an appraisal different than a home inspection? (See list of FAQ's)Appraisers do not do complete house inspections and are not home inspectors. A third-party home inspector will inspect the structure of the property, from the roof to the foundation. The usual property inspector's report will include an evaluation of the integrity of the house's heating system, central air conditioning system (temperature permitting), interior plumbing and electrical systems, the roof, attic, and accessible insulation, walls, ceilings, floors, windows and doors, the foundation, basement, and visible structure.
What is the difference between an appraisal and a comparative market analysis (CMA)?(See list of FAQ's) To be honest, they share nothing in common. What the CMA relies upon are superficial trends. Appraisals use comparable sales which are verifiable resources. The appraisal report will also contain area and construction values. All a CMA does is generate a "ball park figure." Delivering a defensible and careful analysis, an appraisal will give a clear opinion of value.
Who's creating the report is actually the most significant difference between a CMA and an appraisal. A CMA is written by a real estate agent who may or may not be trained in technical valuation concepts or even have a handle on market trends. The appraisal is produce by a licensed, certified professional who makes a living out of valuing properties. Moreover, the appraiser is an unbiased party, with no conditional interest in the value of a home, unlike the real estate agent, who gets a commission based upon the price of the home.
What does the appraisal report contain? (See list of FAQ's)Every appraisal must reflect a credible value opinion and should clearly state the following:
Once the assignment is done, how can I have certainty that the final number is valid?(See list of FAQ's) In communicating an appraisal report, each appraiser must make sure of the following:
Who engages the services of appraisers?(See list of FAQ's) Most of the time, appraisers are hired by lenders to render a value opinion on property involved in a loan transaction - to make sure the house is indeed adequate collateral for the loan. Attorneys and CPAs also hire appraisers for asset division and estate settlements.
Where does an appraiser get the information used to estimate values in Genesee County or other areas?(See list of FAQ's) One of the main things an appraiser does is to collect property data. Data can be classified as either Specific or General. Specific data is taken from the property itself; Location, condition, amenities, size and other specific data are gathered by the appraiser during an inspection.
General data is gathered from a number of sources. To find out about recently sold homes to be used as "comps", an appraiser will typically use the local Multiple Listing Service. To double-check actual sales prices, we use items in the assessor's office and other public documents. Flood zone data is gathered from FEMA data outlets, such as a la mode's InterFlood product.
And most importantly, the appraiser assimilates general data from his or her collective knowledge gained from doing assignments for other houses in the same market.
Why do I need a professional appraisal?(See list of FAQ's) An appraisal is a valuable tool anytime the value of your home is pertinent to a financial decision. If you're selling your home, an appraisal assists you in setting a price that maximizes profit and reduces time on the market. When buying, be sure you're not overpaying by commissioning an independent appraisal. For people settling an estate or divorce, an appraisal from Double J Appraisals, LLC. is the best documentation to ensure assets are split up fairly. Simply put, a house is often the single, largest financial asset anybody owns. Don't make decisions in the dark with a professional appraisal.
My mortgage statement has an item on it for PMI? Can I get rid of that?(See list of FAQ's) PMI is short for for Private Mortgage Insurance. This added policy guards the lender if a borrower doesn't pay on the loan and the market price of the home is less than the loan balance. Once you reach the point where your home's equity plus the amount you've paid is at least 20% of your loan balance, you can have your PMI dropped.
How do I get ready for the appraiser?(See list of FAQ's) We begin with an inspection of the property. During this process, we will come to your home and measure it, determine the layout of the rooms inside, confirm all aspects of the home's general condition, and take several photos of your house for inclusion in the report. Is there anything you can do to help? Yes there is! First, be sure the appraiser has easy access to the exterior of the house . Trim any landscaping and move any items that would make it difficult to measure the structure. On the inside, make sure we can get to appliances like furnaces and water heaters.
The following items, if available, will help your appraiser to provide a more accurate appraisal in a shorter period of time:
What is "Market Value?"(See list of FAQ's) In real estate appraising, Market Value (as opposed to Fair Market Value) is commonly defined as:
Does the appraisal belong to the bank or the consumer?(See list of FAQ's) For mortgage transactions, the lender orders the appraisal, either directly or through a third party. Even though it's the buyer that eventually pays for the report, the lender is the intended user. The buyer is certainly entitled to a copy of the appraisal - it's usually included with all the other closing documents - but is not entitled to use the report for any other purpose without permission from the lender.
This rule doesn't apply when a home owner engages an appraiser directly. In these cases, the appraiser may state how the appraisal can be used; for PMI removal, or estate planning or tax challenges, for example. If not noted otherwise, the home owner can use the appraisal for any purpose.
How can I get the most ROI out of home improvements?(See list of FAQ's) This really depends on where the home is. For example, putting in an inline humidifier could be nice in arid regions, but completely useless near the coast!
As a rule, the best ROI from renovating a home comes in the kitchen. One recent study revealed that putting $20,000 into a kitchen remodel would add about $17,500 to the value of the home - or about an 88% return on investment. Bathrooms weren't far behind, yielding 85%. Adding bedrooms and baths can also help the value of your home as long as your home doesn't then become an oddball for your neighborhood in terms of size.